And so it begins. Were anyone in doubt that the next election will be fought
on an economic battleground, against a shifting background of baffling and
contradictory statistics, they have not had to wait for long for the rude
awakening.

Conservative party leader David Cameron's draft manifesto was attacked for failing to cost his plans to slash the budget deficit.Photo: Reuters

The thrust of the Labour document is very simple: the Conservatives have made a whole series of commitments – some vague, some specific – about the tax and spending policies in the first term of a potential Tory government, but have not yet sketched out precisely how much these plans would end up costing.

The dossier is an attempt to come to a figure to tot up precisely how much those measures will cost, and then to ascertain how much extra that would imply in tax rises or spending cuts that have so far not been spelt out by the Tories. And a series of rather remarkable calculations enable Labour to claim that, in the absence of any further detail from the Conservatives, it could well be the case that HM Opposition is planning to be even more profligate than the Labour Government.

The Conservatives, in turn, have exhumed memories of the Iraq war and Alistair Campbell by deriding Alistair Darling’s document as “a dodgy dossier full of lies”. They claim, in turn, that Labour has been just as guilty, if not more so, of hiding the true scale of the tax rises and spending cuts necessary should they take the country into the next parliamentary term. They point to mistakes in the dossier itself, which has been long in gestation in Labour party headquarters, and was released yesterday as a spoiler to David Cameron’s unveiling of the first chapter of the Conservatives’ election manifesto.

Who is right? As is so often the case in economics, the truth lies somewhere in between what each party is claiming. The Labour dossier claims that the Conservatives have some £33.8bn worth of tax and spending pledges which they have not yet explained how they would afford. Or, to be precise, according to their calculations, by 2014-15, the Conservatives are planning, above and beyond the existing Government plans, to cut taxes by some £21bn, to reverse Labour tax increases at a cost of £13.3bn, to increase spending by £11.1bn. These extra commitments, worth a total of £45.5bn, are balanced out in turn by £11.7bn of extra savings from £5.1bn of tax rises and £6.6bn of spending cuts.

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Moreover, the Labour calculations are, according to Chief Secretary to the Treasury Liam Byrne, who helped draw up the list, “as generous as possible to the Tories”, taking their costings directly from the Conservatives where possible and often using low estimates of the spending. And many of the sums look sensible and reasonable.

However, the document is critically undermined by some key problems. First, Labour has chosen to include all kinds of measures which are not explicit Tory pledges, let alone rubber-stamped manifesto promises. By choosing to document an exhaustive list of ideas mooted by Tory MPs, but not necessarily touted as actual definitive promises, the Conservatives claim that Labour has swelled the apparent shortfall by over £11bn. To take three examples, the dossier claims the Tories are planning to abolish the 50p tax rate, at a cost of £2.4bn, to reverse restrictions on pensions tax relief for higher earners, costing £3.6bn, and abolishing stamp duty on shares, for £5.2bn – three pledges that, the Tories insist, are not official Conservative Party policy.

The second problem is that some of the Tory spending plans are reliant on achieving either tax increases or spending cuts elsewhere. According to Carl Emmerson of the Institute for Fiscal Studies, the dossier occasionally chooses to include the extra spending commitments without predicating them on the tax increases or efficiency gains they should go alongside.

But most importantly of all, the document merely underlines a failing Labour itself is just as guilty of. Neither party has set out, in detail, their costed plans for their tax and spending during the next Parliament. According to the IFS, Labour needs to find some £39bn of extra savings by the end of the next Parliament to meet the broad-brush plans it laid out in the pre-Budget report. It has not yet spelt these out, but they would equate to cuts of some 17pc in those departments not ring-fenced under current Government plans. So the dossier, and David Cameron’s assassination of it, merely underline the fact the public will not get the full story from either party ahead of the election.

Instead, the document was privately dismissed by a number of City figures yesterday as mere politicking. The ratings agencies will ignore it, and most manifesto pledges, and Britain’s credit rating will depend instead on the emergency Budget likely to follow the election.

But, within these parameters, dodgy or otherwise, the dossier must be seen as a small victory for Labour. It has at least pushed the Tories into promising more detail on their plans. Whether it will backfire, forcing them to reveal more of their own plans than they intended, remains to be seen.

Whether it makes the public sick of the relentless stream of meaningless pre-election statistics entirely is another question.